Tag Archive | "leasing"

Mercedes-Benz Financial Enhances Lease Turn-in Process


FARMINGTON HILLS, Mich. — Mercedes-Benz Financial is enhancing its lease vehicle turn-in process, called First Class Finish, by providing new software for its dealers hand-held Dynamic PDA (personal data assistant).

Mercedes-Benz USA provided the Dynamic PDAs to all dealers in 2009. They have been using the device for various services, such as a pre-delivery inspection of each vehicle before it is ready for sale. Each dealer has received one to four PDAs, depending on the size of the dealership.

The new software for the PDAs is the first step in several technological enhancements for First Class Finish since the customer and dealer-friendly initiative was launched last year.

Now, when a customer brings a leased vehicle to the dealership at the end of its term, a dealership representative can use the PDA to scan the vehicle identification number (VIN) and start final inspection, the first step in the new lease vehicle turn-in process which takes about 15 minutes, compared to 30 minutes in the prior process.

“This technology is beneficial to both the customers and the dealers because it eliminates paper forms for the dealer and is a much faster and efficient process for busy customers,” said Jeff Gartland, director of remarketing for Mercedes-Benz Financial. “We see a great opportunity to end the paper process and replace it with a green process that benefits everybody.”

First Class Finish was rolled out to Mercedes-Benz dealers in the second quarter of 2009. The new process eliminates the vehicle’s final inspection by an independent third party and brings clarity to the customer through increased communication with the dealer.

The First Class Finish process:

  • Adds a brief pre-inspection at the originating dealership around 90 days before the end of the lease term
  • Allows final inspection at any Mercedes-Benz dealership at the end of the term
  • Provides final documentation and billing to the customer on the spot, not several weeks after turning in the vehicle
  • Gives the customer an explanation of all applicable charges
  • Gives the dealer the opportunity to pre-inspect the vehicle, discuss the condition with the customer and determine the customer’s future intentions
  • Gives customers a preview of brand new product at the dealership
  • Informs customers if they qualify for loyalty pull-ahead programs which may waive the remaining obligation on their current lease.

“The best case scenario that benefits the customer, dealer and Mercedes-Benz Financial is if the customer comes in for the pre-inspection, discovers that they qualify for a pull-ahead loyalty program and they drive home in a brand new vehicle,” Gartland said.

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Early Lease Terminations Balloon


BANDON, Ore. – Terminating a lease earlier than its contractual length has skyrocketed in the last two years, growing from a typical 15 to 16 percent to more than 21 percent in 2009, reported CNW Marketing Research.

Not only are early terminations rising, they’re occurring significantly earlier in the contract period. For example, CNW found that in 2000, early terminations occurred about four months prior to the actual lease end. In 2009, it was more than 14 months, up from 12 months in 2008.

Twenty-four percent of those surveyed by CNW indicated that “change in job status” was the primary reason for early terminations. In follow-up surveys, more than half of those job changes were related to either losing a position or a roll back in pay or commissions.

The second most frequently listed reason had to do with lease payments being too high, which the market research firm says indicates that leasing is “hard-wired into the economic recession.”

This link, however, has also had an interesting impact on another area of leasing, CNW noted. While “original lease too long” was the most frequently mentioned complaint in 2005 and 2006, fewer lessees listed that as a complaint in recent surveys.

In leasing’s heyday, 24-month leases were common and 35 months was the average of all leases. In the latest data, the average lease runs in the 48- to 50-month range, in part reflecting the longer term contracts written by independent lease companies and the attrition of some major captives from leasing.

CNW also noted that lessees seemed to accept these longer terms in order to keep the monthly payment as low as possible, and the type of vehicle leased at the higher end of the price spectrum. However, the research firm found that this acceptance by consumers didn’t equate to increased satisfaction with leases.

“After six years of steadily rising lease-satisfaction scores, ’07 and ’09 saw year-over-year declines,” the firm wrote in its December newsletter. “CNW’s own data has long shown that the shorter the lease, the more positive the lessee is about leasing, the vehicle leased and the manufacturer.”

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